The Burnham Government is preparing a major reset of British policy towards Israel, with Foreign Secretary Ed Miliband telling MPs that ministers will bring forward a comprehensive package of measures aimed at countering settlement expansion in the occupied West Bank.
Miliband said the Government would not accept what it sees as the erosion of the two-state solution and singled out the E1 settlement project, which would involve around 3,400 homes between East Jerusalem and Ma'ale Adumim, as a red line.
The Foreign Secretary also said officials are examining how to stop British companies from financing, constructing or advertising new Israeli settlements, while stressing that a wider set of measures will be announced in the coming weeks.
Miliband promises comprehensive action
Making his first appearance at Foreign Office questions in his new role, Miliband told MPs the Government was moving beyond criticism towards a broader policy response.
He said the reset would not be limited to trade and would also consider the implications of the International Court of Justice's advisory opinion on the legality of Israel's occupation of Palestinian territory.
The Government has not yet published the final package, meaning the precise measures, legal mechanisms and timetable remain undecided.
E1 project at centre of UK concern
The immediate focus is the E1 settlement project in the occupied West Bank.
The plan would provide for around 3,400 homes in an area between East Jerusalem and the Israeli settlement of Ma'ale Adumim.
Britain and a number of international partners have argued that development in the area could further fragment Palestinian territory and make a viable future Palestinian state more difficult to achieve.
Miliband described the E1 project as crossing a red line and said the UK would not acquiesce in what he characterised as the destruction of the two-state solution.
UK companies could face new restrictions
One of the clearest areas under consideration concerns British companies involved in settlement activity.
Miliband told MPs that work was under way on how the Government could prevent UK firms from financing, constructing or advertising new settlements.
That could potentially lead to new restrictions on commercial activity linked to settlements, although ministers have not yet set out the detailed legal form such measures would take.
Reports have also suggested the Government is considering tougher restrictions on trade involving settlements, but no final policy has yet been formally announced.
Government links reset to international law
Miliband also connected the emerging policy to the International Court of Justice's 2024 advisory opinion on Israel's occupation of Palestinian territories.
The ICJ opinion said Israel's continued presence in the occupied Palestinian territory was unlawful and called on states not to render aid or assistance in maintaining the situation.
The UK Government had previously said it was assessing the implications of that opinion across Whitehall.
Miliband's remarks suggest that review is now feeding directly into Government policy, although the advisory opinion itself is not the same as a binding judgment between two states in a contentious case.
Further sanctions remain possible
Foreign Office minister Stephen Doughty has also indicated that further sanctions remain under consideration.
The UK has previously imposed sanctions on individuals and organisations linked to extremist settler violence and settlement activity.
Any expansion of sanctions would mark a further escalation in Britain's response to developments in the West Bank.
Israel warns of retaliation
Israel has reacted angrily to the prospect of additional British measures.
Israeli Foreign Minister Gideon Sa'ar warned that Israel would respond if Britain acted against it, raising the possibility of retaliatory diplomatic or economic measures.
The warning underlines the potential cost of the Government's new approach and the possibility of a wider dispute between London and Jerusalem if the UK introduces significant restrictions.
A shift under Burnham
Prime Minister Andy Burnham had signalled before taking office that his Government would consider tougher action against settlement expansion, including restrictions on trade connected to settlements.
Miliband's Commons intervention now provides the clearest indication yet that the new Government intends to translate that position into policy.
The move represents a more interventionist stance towards settlement activity while maintaining Britain's formal support for a negotiated two-state solution.
Balance between Israel's security and Palestinian statehood
The Government continues to recognise Israel's security concerns and its right to security, while arguing that settlement expansion in the occupied West Bank undermines prospects for a negotiated peace.
Supporters of tougher measures say the UK cannot credibly back a two-state solution while taking no action against policies it believes make that outcome less viable.
Critics, including some pro-Israel groups and politicians, argue that sanctions or trade restrictions could damage bilateral relations, prove difficult to enforce and risk wider economic consequences.
What has actually been decided?
For now, the most important distinction is between the Government's confirmed direction of travel and the measures that have actually been enacted.
Miliband has confirmed that a comprehensive package is being prepared and that officials are examining how to stop British involvement in new settlement activity.
However, the Government has not yet published the final package, introduced a general settlement trade ban or announced the full list of any new sanctions.
The next significant step will come when Miliband sets out those measures in detail in the coming weeks.
Sources
- UK Parliament: Commons business and Foreign, Commonwealth and Development Affairs questions — 1 September 2026
- Reuters: UK to unveil comprehensive response to Israeli West Bank settlement plans — 1 September 2026
- Jewish News: Miliband outlines comprehensive reset over Israel and West Bank — 1 September 2026
- The Guardian: Ed Miliband promises reset of UK policy toward Israel — 1 September 2026